Type II restriction endonucleases (RE) were discovered as agents that digest foreign double -stranded (ds) DNA in bacteria. They do so by recognizing and cleaving both strands of DNA within that sequence and thereby abrogate the infectious cycle. Although RE have been used by molecular biologist for cutting DNA in vitro, RE that are active at physiologic temperatures and pH should, in theory ,also have activity against ds DNA viruses and retroviruses (whose RNA genomes undergo obligate transcription into dsDNA in the cytoplasm of eukaryotic cells) in vivo. Studies have been performed in vitro and in vivo to test whether RE can modulate retroviral infection in eukaryotic cells. Using HIV infected human PBL, we have observed marked reductions of reverse transcriptase levels in cultures treated with RE specific for sequences in HIV dsDNA but not in cultures treated with RE that lacked restriction sites in HIV dsDNA. Changes in levels of reverse transcriptase activity correlated with morphologic changes in the culture. Although studies indicated that RE were active in limiting retroviral infection, the mechanism by which this effect was mediated was not apparent, as the HIV DNA fragments expected from the cutting activity of RE were not detected by PCR. Thus, either the fragments were rapidly degraded or RE limited retroviral activity by an alternative mechanism. Further studies were performed in vivo using the mouse model of AIDS generated by infection of mice with a mixture of LP-BM-5 leukemia viruses. These studies demonstrated that both disease indu[unreadable]tion and death were significantly delayed in groups of mice treated with liposome encapsulated RE when compared with control empty liposome treated mice. Studies will be undertaken to improve the efficiency of delivery of RE in vivo and to demonstrate the mechanism of anti-retroviral activity.